It’s well known that the world of eCommerce is a cutthroat, dog-eat-dog environment in which companies attempt to vie for the lion’s share of traffic by any means necessary, but how far is too far for a company to go? J2 Global Communications, a corporation that has made a name for itself through various online services such as email marketing and cloud storage, has exemplified just how far an online company can go to protect their interests. But now, after years of utilizing questionable methods to control the niche market of online fax services, suspicion regarding the ethics of their actions may soon engulf one of the biggest names in eCommerce: Google.
Online fax forgoes traditional phone lines for the transmission of faxes in favor of the internet. The advantages of this are obvious; phone line-based faxes can only send and receive one document at a time, and can incur high costs if sent long distances. By using computer-to-fax machine methodology, businesses may transmit numerous documents simultaneously at higher speeds for less money.
To many, the idea of utilizing the internet for faxing documents rather than phone lines only seems like a natural evolution. After all, with the speed and reliability of the internet being far beyond what simple phone lines can achieve, why would anyone still be utilizing traditional fax at all? But in a move that would be as confusing as Skype trying to patent the use of video chats, J2 has claimed a patent over all fax services that use email at all, regardless of whether the fax-to-email uses .NET, SMTP, or PHP gateways to do so.
But unlike Skype, which would easily see immediate resistance to a patent in the form of a lawsuit from their high-profile competitors like Apple and Google in the form of a fierce legal battle, J2 is able to enforce their patent through aggressive, persistent litigation against their less-affluent competitors. Current competitors struggling against J2 include Ring Central, Nextiva, and Fax87.
Suing the Competition
J2’s early entry into the internet fax market has allowed them to wield a sizable legal team to keep start-ups from threatening their control over the internet fax market. Any competition that arises is quickly served with a lawsuit that often comes close to or even exceeds the entire net worth of their own companies, making them unable to offer up much legal resistance. The result is often an out-of-court settlement in order to avoid the high costs of legal proceedings.
Once their competitors have been litigated against to the point of financial ruin, J2 is then able to absorb their former rivals through forceful mergers. J2 can then maintain this monopoly over the industry, which accounts to over 90 percent of all internet faxes, by shielding their actions behind numerous subsidiary companies like RapidFax.com, MyFax.com, eFax.com, MetroFax.com, Fax.com, and SmartFax.com.
A Monopoly at the Consumer’s Expense
With so much of the market dominated by one company, the results inevitably lead to increased costs for consumers in the form of price gouging. With J2 in control of over 90 percent of the internet fax market, the bulk of all internet fax companies that consumers encounter are under the domain of this single entity. This allows J2 to set slightly different prices for each subsidiary corporation to give the false impression of choice for consumers, and thus, raise prices to whatever level they see fit.
To add to this problem, Google, a key avenue for finding an internet fax service, has also been gamed by J2. A search for “online faxing” and similar keywords typically results in a majority of J2-owned online fax services in both the ads and general search results.
This manipulation of search results not only harms consumers, but it also flies in direct opposition to Google’s own “double serving” protocol. According to Google, “double serving” is a policy created to prevent “multiple ads from the same or commonly-owned company from appearing on the same search results page.” However, J2’s numerous subsidiary companies still account for more ads on a Google search than not. Reportedly, Google has been notified of this violation of their double serving policy, yet the ads remain in place.
As for the regular search results, J2 has managed to gain top rankings through a manipulation of search engines known commonly as “grey hat SEO,” a practice that Google also claims to oppose. This occurs through a clandestine gaming of Google’s PageRank system.
Given that J2 controls so many separate online fax websites, they are easily able to interlink their properties, thus increasing their PageRank in a non-editorial, manipulative fashion. This allows J2 to hold almost all the top-listed ads and regular results from a Google search.
Since Google has been repeatedly notified of J2’s attempts to monopolize search results, some have questioned whether Google is fully committed to rooting out problematic companies like J2, or if they are in fact complicit in their furtive practices. Either way, it’s the consumer who is losing out in J2’s clandestine manipulation of this niche market.